CH Offshore (C13) H2 2023 earnings summary

Executive summary

• FY2023 revenue rose 29.5% to US$24.09m, but net loss widened to US$8.25m from US$3.33m, driven by lower owned-vessel utilisation, higher operating costs and vessel impairment.

• Third-party chartered vessels lifted revenue, while owned-vessel utilisation fell to 44% from 74% as vessels were off-hire, including one involved in arbitration proceedings.

Financial highlights

• Revenue increased to US$24.094m from US$18.599m; charter hire revenue was US$14.496m versus US$8.332m, while other ancillary charter hire revenue was US$9.187m versus US$9.823m.

• Gross loss was US$0.717m versus gross profit of US$2.304m; cost of sales rose 72.4% to US$20.087m, reflecting higher operating and third-party charter costs.

• Operating loss widened to US$8.502m from US$3.701m; net loss was US$8.249m versus US$3.331m, including US$3.100m vessel impairment and US$1.465m ECL charge on trade receivables.

• Cash and cash equivalents fell 35.5% to US$4.726m; operating cash flow was US$0.332m versus US$1.961m, and investing activities used US$1.937m, mainly for dry-docking.

Outlook and guidance

• 2024 is expected to be sluggish amid slower growth, persistent inflation and higher-for-longer interest rates; oil prices could face downward pressure if non-OPEC supply outpaces demand growth.

• Rising oil and gas exploration and production spending, offshore wind demand and limited new vessel supply could support higher charter rates, utilisation and vessel valuations in 2024.

• Priorities are cost-effective operations, efficient capital use and expanding the revenue base while pursuing opportunities in core markets and renewables.